23rd Jul'2021 (Evening)

23rd Jul'2021 (Evening)  --  | Written on 25th Jul at 6.15 PM |

  • Both Nifty and Bank Nifty opened higher on Friday and got sold immediately. However, they got support in the first hour itself and started rising. 
    • Nifty opened at 15856 and made a low of 15768.
    • Bank Nifty opened at 34748 and made a low of 34404.
  • However, Nifty after rising from these lows again got sold off at the end and closed flat. Bank Nifty though rose on the base of sharp short covering and closed marginally above its its resistance at 35000.
  • On Friday morning i mentioned that Nifty may make a move towards 15920, it actually fell short of 20 points. While Bank Nifty I mentioned is strong above 35000 and it closed above this level.
  • On a daily chart, Nifty has made a Doji candle and Bank Nifty has made a bullish candle.
  • Though behind the obvious now, Nifty made a long buildup and Bank Nifty made a short covering on the futures side. So from here, a follow through on both the indices is important to be watched.
  • FII sold again in cash and made some fresh longs on the index futures. DII on the other hand, bought good time in cash. Some buying of DII could be from Zomato as well (The dream IPO listing this week). By the way, Zomato had a delivery value of 8600 Cr (approx 9 times of Reliance :-) ).
  • The results over the weekend for ITC, Reliance and ICICI Bank were good and may boost the sentiment for the bulls. ICICI Bank may help boost the sentiment for Banking stocks and Bank Nifty in particular. Reliance and ITC may help for Nifty.
  • On the options side, FII were more or less neutral. Though it would be important to note that on a MTD basis, FII have reduced their long positions from 80:20 to 59:41. Being the last week of the month, it would be important to see, how we roll into the next series.
  • On the global front, the sentiment has reversed in the US and European markets. Though, Asia continues to be under pressure with Covid on a rampant in some Asian Countries.
  • The options OI indicate a support at 15800 for Nifty and 34800 for Bank Nifty. 
  • On the charts I peg support as follows :
    • To watch for a follow through of momentum, first hour low is first support for both indices
    • Nifty 2nd Support at 15769 (Friday Low)
    • Nifty 3rd support at 15578 (Don't expect this to happen)
    • Bank Nifty 2nd Support at 34406 (Friday Low) - Strong support
  • On the economic front the important events to be watched are New home sales in US on Monday, Consumer Confidence from US on Tuesday, Fed statement and Interest rate on Wednesday and US GDP and jobless claims on Thu, German GDP and European CPI on Friday.
  • So the Week is packed with data coming in from US.
  • Watch for Kotak Bank, HCL Tech, L&T results.
  • Wish a happy trading week ahead.

1. FII were net sellers for 163 Cr today, while DII were buyers for 2187 Cr. A net buying of 2024 Cr from the institutional side.

2. FII's created 12079 longs and created 3011 shorts on the index futures

3. On the option front FII  sold 42777 calls and   sold 50309 puts. They also bought 62094 calls and  bought 45678 Puts.

4. For next week expiry, Nifty has the highest OI for PE at 15000 followed by 15800 and highest OI for CE is at 16000 followed by 15900. Highest Put writing was seen at 15800 and highest call writing was seen at 16000 levels.

5. For the next week expiry, Bank Nifty has the highest OI for PE at 35000 followed by 34500 and highest OI for CE is at 35000 followed by 36000. Highest Put writing was seen at 34800 and highest call writing was seen at 35100 levels. 

6. Asian markets closed mixed and Europe closed in green on Friday

7. US markets closed in green on Friday

8. The breadth of the market was extremely weak on Friday

9. Nifty opened at 15856 and made an intra day high of 15899 and a low of 15768 before closing at 15856 .The range of Nifty for the day was 131 points.

10. Bank Nifty opened at 34748 and made an intra day high of 35088 and a low of 34404 before closing at 35034 .The range of Nifty for the day was 684 points.

11. US Dollar Index is trading at 92.912

12. Except Auto, Energy and Media most of the sectors closed in green

13. India VIX reduced to 11.76

14. US 10Y yields are at 1.281

15. Nifty futures saw long buildup

16. Bank Nifty saw short covering

 

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